Review and Prospect Ten years of trials and hardships, engineering machinery and then a new starting point
The excavator and pump truck as the representative of the construction machinery industry from 2006-2016 in sales experienced a relatively complete cycle. Standing at the current point in time, we believe that engineering machinery is entering a new era, the core driving force from the "demand of the market return, the production capacity of the market clear." The capacity of the supply side is gradually shrinking, and the demand for the demand side is gradually emerging. After the market overkill, will still return to the original growth trajectory, to maintain steady growth.
 
Macro demand changes in real estate demand accounted for gradually weakened, non-real estate factors are improving
The core areas of engineering machinery are real estate and infrastructure. In the past, real estate demand led to the trend of excavator sales, but we found that the proportion of real estate and infrastructure contribution decreased from 0.93: 1 in 2012 to 0.67: 1 in 2016, and the contribution of real estate demand was gradually weakening, such as infrastructure, , PPP projects, etc.) are contributing. We have found structural features and regional characteristics of excavator sales, and since the second half of 2016, large-scale infrastructure projects, mines and PPP projects have provided sufficient incremental demand.
 
Micro-demand changes in stock equipment is being digested, renewed demand dominates
Since the second half of 2016, the excavator as the representative of the demand for engineering machinery products significantly warmer, excavators for 5 consecutive months of sales growth of more than 50%, behind the needs of the warmer, we found that the excavation of the equipment utilization To reach the critical point, the current digging machine holdings growth rate of only 1-2%, update the demand for excavator endogenous actual demand has reached two-thirds, and gradually become the dominant force of excavator demand, from the time trend Look, 2015-2016 is the renewal of the demand for the most explicit two years. At the same time, two mobile phones to gradually accelerate, update demand is expected to be released in the next few years.
 
Industry outstanding enterprise market share rising profit base gradually restored
After the industry demand for low tide, the industry market share gradually lean to the leading enterprises tilt, the industry market concentration in the past few years to gradually upgrade at the same time, domestic brands in the process of quietly rising, 2016 domestic market share of more than 50% , Japan and South Korea brand all the way down, leading enterprises Sany Heavy Industry in 2016 in the field of excavator market share reached 20%. With the demand to pick up, the industry's outstanding corporate earnings base is also gradually restored.
The current stage to excavator as the representative of the demand for construction machinery products are still in the pick up stage, the market generally concerned about the sustainability of demand, especially for real estate investment growth concerns. We believe that the demand for real estate in the current digging demand structure is gradually weakening, non-real estate projects are still in steady growth, while the demand for renewal is forming the long-term trust strength.
Macroeconomic environment, especially real estate investment and other uncertainties, and thus affect the level of industry demand; raw material price fluctuations affect corporate profit margins; industry competition led to higher gross margin decline.